Amazon, Dell, Google and Microsoft: Nearly 60,000 tech layoffs so far in 2024 and ‘more pain to come’
The tsunami of tech layoffs that plagued much of 2023 has continued to hit companies of all sizes this year, from startups and mid-size companies to the mega caps.
On Wednesday, Amazon said it is cutting hundreds of roles in its cloud computing division so it can invest elsewhere. And last week, Dell Technologies said it was bidding farewell to 6,000 of its employees, about five per cent of its total workforce.
Microsoft cut 1,900 of its staff in January, while Google and Ebay both axed at least 1,000 roles each. Amazon and Snap cut 400 and 500 jobs the following month, respectively.
In 2023, nearly 1,200 tech companies laid off 263,180 people, according to layoffs.fyi.
It looks as if 2024 is shaping up to be another challenging year for jobs in the sector. More than 220 tech companies have slashed over 57,000 roles since the start of the year.
Many firms dramatically ramped up hiring during the pandemic but are now facing a rebalancing. The industry faces higher levels of competition and dimmed consumer spending, especially in the hardware department.
Media analyst Ian Whittaker suggested cutting jobs was one way for companies to protect their margins. He also suggested firms may be bracing for weaker financial outlooks.
He said: “There is also the matter of the share price and sending a message to investors about your discipline.
“This is what I think is at least part of the rationale for the cuts at the likes of Alphabet, Amazon and Microsoft. Given their results, there is a not a need to cut, and two years ago they would have been unlikely to implement such cuts. But making them now sends a signal that you will remain focused. That pleases investors,” Whittaker explained.
Last year, Meta’s share price doubled following Zuckerberg’s “, in which the company slashed tens of thousands of jobs and escalated its use of AI.
Some analysts have blamed the job cuts on a pivot to AI, as companies shift “dead wood” and look to the emerging technology to increase efficiency and compensate for lost workers but at a much cheaper cost.
Media analyst at PP Foresight, Paolo Pescatore, said the layoffs will “definitely continue” this year, largely driven by AI. “The technology is transformative and it can help improve their own margins. Therefore, we can expect to see further job cuts over the next year and beyond,” he said.
Whittaker also suggested that companies could be using AI to redress the power balance in favour of management over employees, who gained the upper hand during the Covid-19 pandemic.
Ultimately, he believes the layoff trend is unlikely to see a reversal. “It feels like there is more pain to come.”